abhyudaya wrote:
filmcity wrote:
Thanks BSD! I am trying my level best. But the problem is that dont have any relative in US. And being a co-signor means, if I dont pay he'll have to pay ( someone correct me if I am wrong), or simply their credit limit will be constrained. So, it is improbable to find someone willing to take this risk.
Can someone please share all the clauses and responsibilities of being a co-signor. That will be very helpful.
I can fully empathise with your situation, am in the same boat with Duke admit. Of late, Duke has committed that in case its not able to arrange for loans, I can defer my admission.
In US, becoming a cosigner has several repurcussions :
1) The cosigner becomes liable to payback the loan in case you default. Frankly, this is a minor issue as the cosigner has a good idea of your abilities and school's reputation. Moreover, you and I will try our best not to default..desi genes I say.
2) The more serious issue is that the loan shows as debt on the cosigner's credit report, which may seriously dent his chances of securing loans for himself/his family for such purposes as house, education of child.
Though I know couple of people in US, I am wary of asking them because of 2).
Further, its really ironic and funny that schools such as Wharton are urging admits to arrange for funds from their home country. So much about diversity !!
I guess as of now only K/Chi/HBS are guaranteeing loans w/o cosigner. Hats off to these schools !!
@wooster..your decision makes sense to me. One of my fellow admits has decided to go ahead with ISB, solely because of the loan issue.
Hi everyone,
I too got admit to Duke and since then have been working hard to find noco-signor loan options. I checked with various Indian banks and best terms are with Rs. 20 Lakh limit, 10.5% interest and seven year pay back period. I have sent a mail to Sallie mae inquiring about various possibilities like if they permit Canadian citizens or citizens of other countries to be co-signor or if they are willing to consider credit history in India on a case basis. However for me there are four central issues
1. cost of MBA will be around $150K. to pay back that kind of loan, it will be necessary to work in USA for some time post MBA. now what will be probability that despite MBA from top 10 school (no biases), one may not land a job in USA - considering worsening job situation in USA and world over? If one does not land a job in say USA, is it possible to move to say Canada? (the package will go down to say Can$ 90-120K). Let us be optimistic but not blind, so with the kind of situation there, this is very important issue as we are not sure what would be US Government policy with work permits (H1B).
2. rather than sitting idle and waiting for school to work some loan for us, can we think differently? let us say what has been historic default rate amongst students from particular schools? let me assume for a moment it is 2%. (Duke admits about 50 Indian students and let me say over last ten years, one student defaults out of each class). definitely bank will be concerned over this. but what if rest of students become co-signor for every other student? Say if there are 50 students, then 49 students will be co-signor for every person. so we are spreading risk. the bank is assured and as a group will add credibility to the process. In case of default also for outstanding debt of say $100K, the liability to rest of us will be $2000? sounds vague or unworkable but bankers out of the group may help in stream lining the proposal? If we agree on this then take up with the University and through it to the bank.( it will be very unlikely that 50 Top MBA's will disgrace and let go of benefits of being Alumni of MBA program- then what for MBA?) Can INDUS club be requested to be co-signor? (Sounds funny - but alumni power!!!
)
3. the credit situation has worsened in Sept 2008. however I think loan issue owes to some legislation passed by US government which objected to preferential treatment to some banks. Now, I believe no cosigner loan option can be worked out only through negotiations and by entering into agreement. so that could be one reason which is causing unavailability of no-cosigner loan option. and if that be the case, then I do not see any hope for loan issue getting resolved in near future.
4. Keeping all these issues pending, let me say first year requires $80000 and second year requires $ 70000 (typical case). Can any of you shed light on ( with intention of getting I-20 and Visa)
a. how much money in cash, bank deposit in savings or term deposit needed (loan will be credited to and hence counted as part of yuor bank balance)
b. where can asset in gold be reflected (first year or asset for second year?)
c. Can asset in Land ownership be shown ? how and what will be procedure? against second year requirement? I am proposing it hoping some thing will work out in second year. if in worst case scenario, I have to go with say $40000 loan from some Indian Bank.
Know it is a long post but if some one can enlighten, then I hope that will cover comprehensively all issues probably lot of us are baffling with.
Thanks.